Changes to the Skilled Worker route: A Guide for Employers

On 4 April 2024, the immigration rules changed to introduce higher salary requirements for skilled workers. In addition, these changes stopped care workers bringing dependents, and removed jobs from the shortage occupation list (now confusingly named the immigration salary list). This piece will provide an insight into the salary requirement changes, how they may impact businesses and workers, and how you as an employer can calculate the new required salary levels.

As a part of the changes to the Skilled Worker route, on 4 April the Home Office updated the following areas of the immigration rules which all relate to calculating the required salary level: Appendix Skilled Worker, Appendix Skilled Occupations and Skilled Worker visa: going rates for eligible occupation to account for increased salaries. 

To sponsor a Skilled worker in the UK, you as an employer must offer a salary that meets certain requirements set out in the above rules. Unfortunately, it is not as simple as looking up the salary requirement in one list. To determine the actual salary requirements for a new worker on the Skilled Worker route (those who are not already in the UK as a tier 2/Skilled Worker), several factors must be considered in the calculation. 

These include, 

• the starting point annual salary 
• the ‘going rate’ decided by the specific role’s occupation code, 
• the minimum hourly rate, and; 
• any discounts available to the specific worker. 

Let’s explore these individually below.

To sponsor a new worker, the starting point for the very lowest gross annual salary you can offer for them so they can qualify for the route is £38,700 (appendix skilled worker option A, paragraph SW 8.1.). This is the first figure to keep in mind.

The second factor you need to consider is the annual ‘going rate,’ which is the annual minimum salary for a 37.5-hour working week set for the specific role of the worker you are sponsoring. To determine the annual ‘going rate’, the occupation code needs to be identified in table 1 of appendix skilled occupations. This can be anything from £30,960 to £84,100 depending on the relevant job your new worker will be performing.

Then, you must ensure that your worker’s salary meets the minimum hourly rate of £15.88 for a 37.5-hour week. If you intend for the worker to work more than this number of hours, it must be pro-rated, whilst still meeting the minimum hourly rate.

Finally, any available discounts should be applied. The discounts include if your worker holds a PhD, is applying as a new entrant, or you are sponsoring them for a job which appears on the immigration salary list. These discounts bring the starting point salary down to £30,960 and going rate between £30,960 and £75,690.

With all these factors set out, you must then offer your new worker the highest of these three figures, in order to meet the salary requirement. 

If you managed to get through the above changes, prepare yourself, as things get slightly more complicated when it comes to those workers already in the UK on a Skilled worker route. You must still however, keep the factors from the previous section in mind to calculate the salary requirements for a Skilled Worker already in the UK. 

The Home Office has put in place transitional provisions for existing skilled workers alongside the new requirements for new workers. They have chosen to put these into Options F-K of appendix skilled worker in the immigration rules. 

These provisions give existing workers an annual salary starting point of £29,000 (which some will realise is an increase from the £26,200 pre-4 April).

The occupation code for the worker’s role then needs to be identified in table 2 or 2a of appendix skilled occupations to determine the ‘going rate’ that needs to be paid. This can be anything from £23,200 to £62,800 depending on the relevant job the existing worker will be performing.

Then, you must ensure that the salary you offer meets the transitional minimum hourly rate of £11.90 for a 37.5-hour week. If you intend on the worker to work more than this number of hours, it must be pro-rated, whilst still meeting the minimum hourly rate.

Finally, any discounts should be applied for the worker holding a PhD, applying as a new entrant, working in a health or education role, or if you are sponsoring them for a job which appears on the immigration salary list (or appeared on the shortage occupation list and is now in table 2a of appendix skilled occupations). These discounts bring the starting point down to £23,200 and going rate between £23,200 and £56,520 (not including health or education roles which consider national pay scales).

You must then extend or offer your worker who is already on the Skilled Worker/Tier 2 route, the highest of these three figures, in order to meet the salary requirement. 

In general, these changes are messily drafted (with some errors too) and the transitional provisions running alongside the new requirements have not been reflected on the sponsor management system when assigning certificates of sponsorship. Undoubtedly, and to much concern, they will also cause equal pay issues for workers and employers struggling to keep on migrant staff due to the higher salary requirements.

There is some good news out of these changes, however; supplementary employment is now allowed in any occupation code, rather than the previous restrictions of it being on the shortage occupation list or in the same occupation code as the main employment.

There are many options  that have not been discussed in this short piece, for instance for someone being able to qualify for a discount, or to circumvent the change of rules altogether by workers having assigned the certificate of sponsorship already.

We will cover more about these different options and issues related to Skilled Workers in future pieces.